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Frequently disconnecting, /etc/init.d/networking restart gives me a hardware error. After unplugging, plugging in again and restarting the network, it works for 10-60min.

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Plugged it in, opened harddrake, was asked to install madwifi and firmware automagically, then entered the network center and connected without a problem.

Tested on Mandriva 2009.0.

This is for Version 3 of the dongle ( Totally black )
You have to compile your own driver from:
http://www.ralinktech.com.tw/data/drivers/2008_1225_RT3070_Linux_STA_v2.0.1.0.tar.bz2

Edit the rt2870.h file and add the USB IDs (lsusb output).

insmod + Networkmanager works perfectly thereafter.